Shares of Rogers Communications (RCI-B.TO)(RCI) fell sharply Tuesday as investors mulled over a reported renewal of the company’s NHL broadcasting deal, as well as an analyst downgrade due to concerns about cash generation.

An Associated Press source says Rogers and the NHL have agreed on a 12-year, US$7.7 billion broadcasting deal starting in the 2026-27 hockey season. The deal was first reported by Sportico.

Separately, Scotia Capital analyst Maher Yaghi downgraded Rogers’ rating from “Sector Outperform” to “Sector Perform”, saying the financing costs for the Rogers Mastercard, launched in 2023, “more than offset the relative churn reduction that was likely gained from this endeavour.”

Yaghi points to a notable increase in Rogers’ accounts receivable balance due to the card’s mechanics, risks that the company’s dividend reinvestment plan will continue to dilute equity, and limited prospects in wireless pricing. Scotia has cut its price target from $58 to $50.

Rogers’ shares were down around six per cent on the Toronto Stock Exchange as at 11:30 a.m. ET Tuesday, and are about 18 per cent lower this year.

Yaghi writes that he expects negative earnings revisions as the telecoms results season approaches, and until positive earnings revisions materialize, “we don’t see an impetus to remain bullish.”

Under the terms of the reported NHL deal, which has yet to be officially confirmed by the league or Rogers, National Bank of Canada Financial Markets analyst Adam Shine observes that Rogers’ yearly cost would be US$642 million, up from around US$408 million in the current deal. Shine writes that the new Canadian rights would cost Rogers more than the combined US$625 million paid annually for U.S. broadcast rights by ESPN and Turner.

“Investors wondered how the company was making money on its current NHL deal,” Shine wrote. “Those questions won’t go away when it is about to spend 57 per cent more in USD (112 per cent more in CAD) on the new 12-year package.”

At the same time, Shine notes, the new deal “is sure to increase the value of the Toronto Maple Leafs and, by extension,” Maple Leaf Sports & Entertainment, of which Rogers will own 75 per cent once its acquisition of BCE’s stake is finalized.

John MacFarlane is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jmacf.

Download the Yahoo Finance app, available for Apple and Android.